3 Reasons to Stop Calling Network Marketing a “Pyramid Scheme”

I see posts online with people calling the Network Marketing industry a pyramid scheme all the time, and I hear it in person occasionally as well. I have to say, when this happens it takes a lot of effort to keep myself from educating the people that said it. For this reason, I have set out to hopefully educate some people about Network Marketing a little bit so that we can do away with this line of thinking. To start out, I want to provide you all with the TRUE definition of a pyramid scheme for a basic understanding in case any of you are unsure:

Pyramid Scheme: a form of investment (illegal in the US and elsewhere) in which each paying participant recruits two further participants, with returns being given to early participants using money contributed by later ones.

If you are one of the people that typically refers to Network Marketing companies as a pyramid scheme, I wanted to share these three reasons with you to hopefully help you understand why you should really stop.

Number 1: It is untrue. As defined above, a pyramid scheme revolves solely around recruitment. So as an example I wanted to show you what a pyramid scheme ad looks like. I didn’t really browse that hard, I just went to a random advertising group on Facebook and scrolled for about 5 minutes. I found this gem to the left, and this is just the first I came across of what I am sure would be many to be found on the wall of that group. This isn’t an obvious pitch for a pyramid scheme, because obviously, they would get in trouble. However, I have a little insider knowledge with this $25 per referral ad because someone tried to recruit me for this kind of crap in the past. And that is exactly what it is – total bullcrap. THAT, ladies and gentlemen, is a pyramid scheme. Their sole purpose is to go out and recruit people for the “company”. All they have to do to join is pay a small fee of $25+ dollars to join, and then they can start recruiting more people and earning money immediately. It is a constant return of cash from ONLY recruiting.

Do you see the difference between THIS and between legitimate Network Marketing companies? I hope you do, because it is pretty freakin’ huge… THERE ARE PRODUCTS AND/OR SERVICES FOR SALE… If it is a company that has legitimate products for purchase, it does NOT qualify as a pyramid scheme, despite the fact that it does involve team building. In fact, when you think about a typical corporate environment, there are often bonuses for referrals. When you work at the company for so long, you are granted the opportunity to make recommendations for people that you think would be a good addition to the company. If they are hired, make it through the probationary period, and succeed in their role, you receive compensation for the recommendation. So when you think of it that way, the corporate environment has team building too! The problem here is that this industry is a relatively new concept to people, so it is difficult to grasp I guess. Think of it this way: Each person involved in Network Marketing is essentially the CEO of their own company. In order for a company to grow and become successful, they typically must have other employees and grow in size. It is the same with Network Marketing. To become truly successful, you need to build a team, and you need to nurture that team consistently to help them grow teams of their own as well. When you think of it this way, Network Marketing actually is more of an inverse pyramid. Why? Because in order for one person to be successful, they have to aid their team to be successful. You can’t just recruit a bunch of people, then sit back and rake in cash. You need to train your team, help your team to grow, and push your team to achieve new heights in their business. Nobody can simply sit back and get complacent, which appears to be a common assumption.

Number 2: It is offensive. Seriously though! If you ask anyone in the Network Marketing business what they think about people that refer to their JOB as being a pyramid scheme, chances are they will say that it drives them a little bonkers. It is just so frustrating to be so passionate about a company that you love, and to have so many people on so many different fronts constantly trying to dis what you do. We work HARD at what we do (or at least those of us trying to make this a real career) and it can be offensive and rude to have people look us in the face and call the Network Marketing industry a scam or a pyramid scheme. If you care about your friends and family involved in this industry, please do not use those terms when speaking to them about their business. Even when speaking to strangers, it is best if you just keep those words out of your vocabulary when discussing this topic. These days Network Marketing is becoming super popular for being part-time endeavors, so you seriously could be meeting tons of strangers every day that have businesses outside of their “real” jobs without your knowledge. If you want to avoid an awkward and uncomfortable conversation, just keep those little negative thoughts to yourself!

Number 3: It makes YOU look bad. I am aware that this one may offend a few people, because I am sure that there are a lot of you out there that are guilty of doing this on a fairly regular basis. However, I gotta be real… It seriously makes you look kinda silly and ignorant to those of us that actually know the true definition of a pyramid scheme. We live in a time where SO many people around the world are bringing in full-time earnings by working at home with their direct sales business. There are millionaires in many of these companies, and more and more are made all of the time. If you put the time and effort into this industry, and you are willing to learn and to grow as a person, you can be successful in this industry as well. To say that something is a scam, when it is clearly doing so much good for so many family and individuals around the world, is just ridiculous.

If you have been guilty of this, I want to encourage you to please just stop. Start thinking of Network Marketing for what it really is – a successful business opportunity not for the faint of heart.